Interview with Matthias Schranner, SNI

Negotiation skills for lawyers and managers - mandatory but underdeveloped

Matthias Schranner, President of SNI LLC in New York and noted author of books on negotiation, talks about negotiation skills in general and about differences in negotiating with lawyers and managers. Matthias Schranner was interviewed by Bruno Mascello.

I am sure you are currently also following the negotiations between the EU and Greece. Anything particular you have noticed from a professional negotiation point of view?

During negotiations you see different phases. At the beginning, you analyse your negotiation partners, their motives, and their needs. Then you try to convince your counterpart. Very often the parties create a deadlock where the two positions have no more room left to move. And then you need to get to an agreement. Let's take a look at the negotiations with Greece; I notice that the negotiations are taking too long. It is now time to finalise the negotiation phase, and the parties should very quickly get to an agreement, even if it is that they agree to disagree. If you stay in a deadlock scenario too long you may not only damage the negotiation, but you also risk to completely destroy your relationship with the opponent. The biggest problem here is not really in the negotiation room. You find it in the early commitment both parties made to their communities, they are stuck now and cannot move without losing credibility. Therefore they should rather try to move away from there and find a new viable target for both.

Lawyers consider themselves to be professional and experienced negotiators. What do you notice when lawyers negotiate? Any particular recommendations you can provide?

Most lawyers are really professional negotiators since this is part of their daily business. They are really good in one specific phase of the negotiation, namely when it comes to establish a clear and specific position, including elements which may be subject to change or not. However, most of them are not experienced in handling a deadlock scenario. In such a situation you need creativity, the ability to play and to gamble a little bit. In most tough negotiations lawyers are too rational and not prepared to play the game. Depending on one's understanding what a negotiation is about, this could be learnt and improved. However, if you think a negotiation is just about being right or wrong, you face a big challenge. You should become more flexible and realise that there is not just black and white, but that there are a lot of colours in between.

Do managers, such as CEOs and CFOs, negotiate differently?

Yes, definitely. Managers have to focus on the big picture and not on a tiny little contract provision. In tough negotiations, CEOs sometimes ask me to negotiate without lawyers and explain to me that in their eyes lawyers tend not to see the big picture, thus risking a big deal. To stay with a picture, lawyers too often focus on a single tree instead of seeing the entire forest.

You are often called to negotiation situations when it is only possible to win or to lose (e.g. in case of a hostage-taking), i.e. when win-win negotiations are impossible. Do you consider a compromise, as you may see very often in the corporate world, i.e. a situation where both parties need to give in a bit, a lose-lose solution?

The win-lose situation applies only to those tough deadlock scenarios where there is no trust at all. However, if you have a relationship of trust you will not end up in such a deadlock situation, and there is indeed a win-win outcome possible. My focus and experience is based on tough negotiations which you also may see from time to time in the corporate world and where there is no room for co-operations. Such situations are qualified by a fight where you should not offer a compromise too early or give in too easily. As an example, you may see this with M&A deals or when procurement tells their suppliers that they need to comply with certain conditions if they still want to be considered in the future. In these tough situations you send the signal to your counterpart that you are not willing to avoid a conflict and that you are willing to fight for your interests.

What can managers and lawyers learn from professional negotiators such as police officers or investigators for their next contract negotiation?

Lawyers are knowledgeable and well experienced in negotiations. However, they are not ready for tough negotiations with deadlocks; let's say that your counterpart is threatening to withhold his signature if you do not match a specific price. In such cases, even many well-experienced negotiators may have some room for improvement.

We have learnt that successful negotiators always take the cultural framework into account. For example, would "saving one's face" be a valid principle everywhere? Are there any other golden rules of dos and don'ts you come across all the time in your daily work?

Yes, "saving one's face" is indeed an important element in all cultures. You find Japanese and Chinese cultures that try to avoid a commitment - if you commit yourself too early you will lose your face in the end. There are other cultures, such as South Korea, where the negotiations are extremely hard and very tough. Here it is not about keeping face but about fighting. So, you see, there is no uniform Asian negotiation culture. However, what is important is to know that most managers at the C-level are internationally educated and have a broader view and understanding. As a consequence, you will face more problems on the second and third management level that lack sufficient experience with global negotiations. By the way, the same also applies in Europe, and you will notice differences between the countries. For example, in the German-speaking parts of Europe in particular you notice that the language is too direct and always based on right or wrong. Because the parties really believe they are right or wrong they often use the corresponding language like "you are wrong" or "but you have to understand that". That means that in those countries the negotiators are not flexible and not gamblers and their language sounds as if they were fighting.

Let's look now a bit behind the curtain of Matthias Schranner. When you are on holiday, are you on negotiation mode as well, or can you relax? And where are your weak spots when it comes to negotiate with your kids? I think this might be a pretty unfair situation for them, being faced with a professional negotiator like you?

I can completely relax when I am with my family. However, what I cannot do is stopping to analyse people when I talk to a person I do not know. But this does not mean that I constantly negotiate, for example when I buy a T-shirt at the beach. And talking about my kids, it is indeed unfair, but let me tell you, it is unfair for me! My kids are great negotiators, they know me very well and how to handle me, and they exactly know my triggers and they use them against me! But it is a relationship of mutual trust and therefore absolutely fine.

Any final remark you want to share?

The most important advice I would like to give is that: Keep in mind that a negotiation has different phases for which you need to prepare yourself. A negotiation needs to be seen from different perspectives. And in some of them you also need to be more flexible and gamble a little bit. And you should not forget to have some fun as well.

The negotiation expert, Matthias Schranner, was trained by the German police and the FBI for the most difficult negotiations. As a consultant, he supports the UN, global corporations, and political parties with his institute - SNI - during difficult negotiations. He is the author of the books "Negotiations on the Edge", "The Negotiator", and "Costly Mistakes" and has published numerous articles. He serves as adjunct faculty for negotiations at the St. Gallen University in Switzerland and is President of the SNI LLC in New York. Numerous Fortune 500 Companies use his proprietary Negotiation Scorecard® for negotiation support